It has certainly not been a quiet year for Didier Leroy. He started 2010 as Toyota’s European sales and marketing boss and, as damaging recall problems dented the company’s global reputation, he was appointed chief quality officer for the region in March. Last month he became president of Toyota Motor Europe.
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Even though Toyota has enjoyed a global reputation for quality, benchmarked by other manufacturers, the company’s focus is now even greater on that and safety following its well documented recall problems of the past year.
Leroy said: “We are also aware that our competitors are improving all the time so we have to look at how we retain leadership. We have to be not one step but two steps ahead of everyone else.”
Despite its recall problems, the company has still managed to score highly in JDPower customer satisfaction and cost of ownership surveys.
Leroy continued: “I have been personally and deeply involved in the problem solving in Europe and, to make sure we handled the recall issue, we adopted the Japanese Genchi Genbutsu approach – go and see for yourself.
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By GlobalData“That means not just looking at technical reports or listening to a customer complaint. It literally means we have people out in the field physically looking at the problems.
“All our European vice presidents get a daily report on technical problems and issues and we meet weekly to review these. We have decided to form a specific organisation in Europe with regional offices that will send out people within 24 hours to look at any technical issues reported by dealers or customers.”
But it has not just been the recall problems. Like all carmakers, Toyota has suffered during the economic downturn. Leroy, a Frenchman who joined Toyota from Renault, said: “In terms of market share we are strongest in eastern Europe and the Nordic countries, areas which were hit particularly hard by the economic crisis, while our new products in 2009 were in segments which were also affected so we could not enjoy the full benefit of these.
“Sales were also down because of our own decision not to push vehicles in the fleet markets where large discounts are expected. There is no point in selling cars at a loss.”
First half sales of the Toyota brand in Europe were 394,500, 13% down year on year, although Lexus rose 15% to 15,200 vehicles and Prius hybrid sales almost doubled to 27,700 [helped by the launch of a full redesign].
Leroy is optimistic that the company has some new cars which will start clawing back market share, such as the hybrid UK-built Auris and Lexus CT200h, the luxury brand’s first offering in the premium C segment.
But there are critical rumblings that Toyotas lack passion and are not exciting to drive. The company no longer builds cars such as the MR2, Celica or Supra.
“How we get more passion into our cars is the challenge for the next few years,” said Leroy. “We want to attract these types of buyers but without taking away what our existing customers love about our cars.
“We showed the FT-86 [a revival of an acclaimed 1980s Corolla sports coupe] at last year’s Tokyo motor show which many people see as the ‘new’ Celica or Supra and we will build that model. While everyone today wants a green car, they would also like a red devil in the garage for the weekends.”
The Lexus brand has struggled in Europe since its launch here in 1990, finding it hard to compete with the established German luxury brands.
“The secret is not to try and compete with them,” said Leroy. “If we tried to go for volume with Lexus in Europe then Audi, BMW and Mercedes-Benz would do everything they could to stop us – and they would.
“We have a business plan that sets a modest level of sales which are profitable for TME and for our dealers. The RX hybrid is proving a good model for Europe, as our first half sales show, and the CT 200h will be a new start for the brand in the region giving us a model in the C-premium sector for the first time.
Leroy said the company was also looking at its brand identity. “Toyota and Lexus have well-defined characteristics but they tend to be in the delivery of engineering, quality and safety but nothing that people can actually see.
“We are looking for something that sets our brands apart – makes them instantly recognisable as a Toyota or a Lexus without seeing a badge.”
This does not necessarily mean a new ‘family face’. “There has to be differentiation but also a common and strong sign to the customer.”
Leroy added that Toyota’s European operations have a strong role to play in the company’s global strategy. “We have input to many projects, not just those that are relevant to Europe.”
